The Conservatives’ plan to extend right-to-buy is bad politics as well as bad policy. This worked well in 1979, but voters are too astute to be swayed by the same policy card played twice.
We have 3.4 million people on local authorities’ housing waiting lists, representing some 1.4 million households, yet we are building less than one 10th of that number of new homes each year.
The only tenable solution to the country’s housing crisis is to build more homes — a lot more, and as quickly as possible. That requires bravery around the release of public sector land and innovation in the planning system.
We welcome the headline numbers for new homes to be built in both the leading parties’ manifestos. But the numbers lack any credibility unless they can be paid for and physically delivered. Since the coalition revived the right-to-buy in 2012, the promises of one new affordable home built for each one sold have proved hollow and without change in the policy, there is no reason why it should be any different after this election.
Moreover, extending the right-to-buy to housing associations will seriously damage their ability to help us build our way out of the housing crisis. They rely on private finance to build now, not government grants. The huge loans they carry are just big mortgages, and they require security in the form of homes, the rents they produce and their underlying market value. If that security has to be sold off to tenants at big discounts, there is a real risk associations will become unfundable. Loans may have to be repaid and the receipts from sales at discounts could be insufficient to meet liabilities.
We think this will mean fewer affordable homes being built, rather than more, and therefore this policy could backfire spectacularly on the government for the sake of a few extra votes in this election.
Richard Petty, head of affordable housing at JLL